"The big problem is that O365 used the Outlook domain for some things, and it doesn't let you clear the cookies right," he said on Twitter, where I asked individuals experiencing problems to weigh in. "Because the cookies aren't cleared it refuses to let you sign up for a new account, instead directing you back to O365," Bright added.

Microsoft launched a preview of its new Outlook.com service on July 31. Immediately, a number of those with existing Office 365 accounts began reporting "infinite loops" which prevented them from being able to create a new Outlook.com account.

I asked a Microsoft spokesperson about the issue and was told users might try clearing their caches. "If they sign out and then sign back in with the correct account info, it should auto detect what account to log into," the spokesperson said.

A workaround is to set up an Outlook alias, a number of Twitter folks have noted. But users who proceed and rename their existing email addresses should know the following, according to Microsoft officials on Reddit:

"You will not have to re-purchase anything. For WP7 you will need to reset your phone, and signin with the new account. You will need to reinstall all apps, but won't have to re-purchase any of them. You'll also need to go to sync settings and make sure mail is enabled."

On Windows 8 (that's what the person responding said, though I'm unclear if s/he actually meant Windows Phone 8), users who make the switch will "need to disconnect your account and then reconnect your new one, but then everything is preserved," the Microsoft team member added.

Update: Users are continuing to try to unravel the mystery of why some Office 365 users can't manage to sign up for Outlook.com. Windows-now.com blogger Robert McLaws made an interesting observation on Twitter, noting that Office 365 users who want to check mail through the Outlook Web App use the outlook.com URL to do so. "Once you sign into http://Outlook.com w/ a MS Account, it redirects u to a http://mail.live.com server," McLaws tweeted.

So perhapd this is a backend infrastructure/identity issue that Microsoft needs to address? Just a guess. Still no further information from the Softies on what's going on here.